Monday, January 27, 2025
Foreigners can now invest in Makkah and Madinah-listed real estate enterprises
Foreigners will be able to invest in Saudi companies listed on the Saudi Stock Exchange that own either temporary or permanent real estate within the boundaries of Makkah Al-Mukarramah and Madinah Al-Munawwarah, according to the Capital Market Authority in Saudi Arabia. Trending: World's tallest tower is expected to be completed by 2028
This change will take effect today, following the approval of controls to exempt companies listed on the Saudi Stock Exchange from being considered "non-Saudi" according to the system for non-Saudis owning and investing in real estate.
The announcement is part of the authority's larger strategy to attract investment, improve the financial market's attractiveness and efficiency, boost its regional and international competitiveness, and strengthen the local economy.
It also aims to provide the liquidity needed for current and future projects in Makkah and Madinah using investment products available in the Saudi market so that these high-quality development projects can be funded.
The approved regulations state that foreign investors cannot own more than 49% of a company's shares; however, foreign strategic investors are exempt from this rule and may invest in Saudi companies listed on the Saudi Stock Exchange or in convertible debt instruments into shares.
This means that foreign nationals who do not have Saudi nationality cannot own more than a small percentage of a company's shares. Most viewed: Saudi Traffic department warns vehicle drivers with these messages
Approved controls ensure that non-Saudi investors may benefit from the financial rewards of ongoing and future projects without breaking any laws or following any specific instructions, particularly those related to the non-Saudi ownership and investment system in real estate, whether the company is listed or not.
Meanwhile, listed Saudi companies can now acquire ownership, agreement, or use rights to real estate within the borders of the two holy cities that is allocated for their headquarters or branch offices.
As long as the property is fully used for this purpose, the authority provides this right in compliance with the approved controls that excluded non-Saudis from the real estate ownership system.
It is important to mention that the Capital Market Authority has been actively working to make the Saudi financial market more appealing to foreign investors.
They have implemented various measures to make it easier for foreign investors to invest directly or indirectly in the Saudi stock market, provide options for foreign investors to enter the Saudi stock market through swap agreements, allow foreign strategic investors to own strategic shares in listed companies, and allow foreign investors to invest directly in debt instruments. Read: Saudi Arabia fines several companies for not providing health insurance to their workers
This shows that the financial market financing system and options available for projects in Saudi Arabia are comprehensive and diverse.
An important step toward achieving Saudi Vision 2030's goal of attracting domestic and international investment into the Saudi financial market was the Capital Market Authority's 2021 decision to open real estate funds invested within the Makkah Al-Mukarramah and Madinah Al-Munawwarah borders to non-Saudis.
After conducting a public opinion survey on "the controls for foreign investors' ownership of shares in listed Saudi companies that have investment properties in Makkah and Madinah" on November 15, 2023, through the Survey Platform and the Authority's website, the controls were finally approved.
The survey was open to the public and government agencies affiliated with the National Competitiveness Center.
One can see the rules that exempt Saudi Stock Exchange-listed firms from being considered "non-Saudi" in accordance with the system that allows non-Saudis to own and invest in real estate in this link. Join Saudi Expatriates channel on WhatsApp
Foreigners can now invest in Makkah and Madinah-listed real estate enterprises
